WTO services treaty expanding into public services and domestic regulation

March 28, 2002

OTTAWA--Senior government officials have just returned from a negotiating session in Geneva to expand the reach of the World Trade Organization's services agreement into areas usually considered the exclusive prerogative of domestic policy-making. On the table are public services such as education and health care, and public interest regulations such as tobacco control and environmental protection laws, say the authors of a new report released today by the Canadian Centre for Policy Alternatives.

"It is disturbing that the Canadian and other governments are doggedly negotiating to expand the GATS -- even though its existing policy impacts have neither been widely debated nor understood," said Scott Sinclair, co-author of Facing the Facts: A Guide to the GATS Debate.

According to Sinclair, despite denials by its supporters, including the OECD and the WTO, the GATS seriously threatens public service systems and public interest regulation.

The authors' previous works have been the target of official rebuttals by both the WTO and the OECD. "That these organizations would go to such lengths to attack our work is an indication of how nervous they are about outside criticism," said co-author Jim Grieshaber-Otto. "Our report is a response to these attacks."

According to the CCPA report, the key GATS provision that purportedly excludes public services is largely ineffective. For example, it does not protect against the extraordinary decision made during the last round of negotiations to cover Canadian health insurance under the GATS. "Because of this reckless act, if Canadians now choose to expand Medicare to insure home care or drugs, then Canada is on the hook to make additional GATS commitments to compensate foreign governments whose private insurers lose market access," said Sinclair.

The WTO and OECD documents also play down the significance of the current negotiations on domestic regulations. "The proposed GATS restrictions are excessive and a recipe for regulatory chill," added Grieshaber-Otto.